There are so many ways that you can borrow money. Although most people simply use their credit cards for everyday purchases, these credit cards can also be great ways to build a good credit history.
Here are 6 of the most commonly used credit cards in circulation:
Soak Up Your Credit Rating
A recent study by the Harvard Business School and the Peterson Institute for International Economics found that the average American household carries an average of $27,000 in credit card debt.
If you are unable to pay those cards off immediately you may find yourself saddled with even more debt.
How can you rebuild your credit rating? That is actually what Bill Nye, the host of the most recent science fiction series, How to Build A Credit Card and the creator of the award-winning HBO series, told the crowd last week.
If you have been considering signing up for one of the few credit cards available, you may be surprised to know that there are more steps you can take to rebuild a credit record than rebuilding your wallet.
Firstly make sure you know what type of credit card you currently have. Is there any card that offers you rebates for your purchases as you advance your credit line? Are you able to pay off your cards just by remembering to charge some money on your card? If you do not know what type of credit card is best for you then there is nothing better for you to find.
Next you’d be asking yourself – ‘What can I do about this?’ ‘What happens if I run out of gas?’ ” ”What’s the best plan?’ ””What’s the best way to pay off the debt?’ ‘These are just common sense questions you should be asking, don’t they tell you everything you need to know about what happens to your cards’ loyalty? Well all they tell you is – ‘Next time you use your card, you are going to lose money.’
Now that you have a clear picture of what is most important when you decide which type of credit card to sign up for you should be focusing on these 7 tips to build your credit card:
1. Check your balance. Do you really need to do this?
It is not the end of the world if you do not have to pay off your credit cards. There are a few tricks you can use to keep your credit cards earning you a reward before you leave.
Check your balance. If you set up a high credit limit, you could end up charging a higher interest rate to your card. Even if you have a lower balance, if you have a higher interest rate you will not earn any cash back along the way.
The best way to increase your percentage rate is by paying bills on time, paying off credit card accounts with all your cards and, importantly, by using your card to make even one purchase. How you pay off your card is a key part of building your credit history.
2. Be smart about your credit cards.
It is not the end of the world if you don’t have to pay off your credit cards. Many people use their vehicles for routine business, and charge new cards and purchases to cover for their employees.
If you don’t pay off your cards, you will be paying an interest on your car loan, which will only add up at a higher interest than the normal annual balance. Make sure that you pay off your costs. Your annual cash advance will carry on past due, at least for the life of the loan.
3. Avoid offers for extra services.
If you don’t get some extra services, don’t sign up for extra services. Most offers for different services will ask you to pay extra fees, usually by monthly installments and penalty fees. Don’t sign anything up unless it is really necessary.
Some of these services may expire as a result of you not paying your agreed annual fee and these companies don’t give a f*cking “free” penny any more.
4. Talk credit card with creditors.
Although the card issuer can offer you a reasonable interest rate and the benefits of the services you have signed up for, they will insist on your being able to make that agreement work for you.
Because most people don’t feel you can make their terms work for you, people can be rude and get on the record of ‘suspecting a liar’ when you’re talk to them about your credit card debt.
If you are speaking to a credit card company for the first time, be sure to check your own credit card statements, compare their rates, ask them for their interest rates and other useful information. You’ll find some really smart and responsible people doing the right thing with their companies.